When it comes to increasing profitability, pricing is often the most powerful lever an organization can pull. Small changes in selling price can deliver meaningful growth to the bottom line. Despite this reality, pricing dynamics are often poorly understood by companies and, in turn, pricing strategy is undermanaged.
aOrlian Consulting has deep experience helping clients define pricing strategies that support our clients’ value propositions and deliver profit improvement.
We utilize a number of frameworks and techniques when developing winning pricing strategies. Examples include:
- Price elasticity: Quantify sensitivity of demand to pricing levels and changes
- Equity/attribute value drivers: Conjoint analysis to define utility of different attributes to consumers, revealing the importance of purchase drivers and enabling pricing based on consumers’ perceived value, not solely cost plus
- Differential pricing: Price tiers based on geography, brand and product role in the assortment
- Category and product roles mapping: Alignment of pricing benchmarks and rules to category/product roles
- Minimizing gross-to-net erosion: Isolate factors that drive the gap between gross and realized net price and strategically minimize each
- Price pack architecture: Combine consumer insights, competitive dynamics and a company’s capabilities to identify ideas, simulate/test results and drive new price pack architecture solutions